Earnings from exports declined while expenditure on imports increased during December 2019, widening the trade deficit. During the year 2019, the trade deficit contracted significantly, driven by a sharp contraction in import expenditure. The speed of recovery in tourism industry accelerated in December 2019 although cumulative earnings from tourism declined during the year. Workers’ remittances increased notably (year-on-year) in December 2019 helping to moderate the cumulative decline in 2019. Meanwhile, there was a notable outflow of foreign investment from the government securities market during December 2019 while marginal net outflows were also observed from the CSE. The Sri Lankan rupee appreciated against the US dollar during 2019 and remained stable thus far during 2020.

Manufacturing PMI expanded at a slower pace in January 2020 recording an index value of 54.0 mainly due to the slower expansion in New Orders and Stock of Purchases.

New Orders, Production and Stock of Purchases sub-indices expanded at a slower pace particularly in the manufacturing of food and beverages sector with the decreasing demand after the festival season. Further, a slowdown in Stock of Purchases in textile & wearing apparel sector could be observed due to Chinese New Year holidays. The Employment contracted during the month due to the leaving of employees from their jobs for better paid employments.